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Transparency in the financial services industry in Uganda has improved due to proper legal enforcement from the regulator – the Bank of Uganda, according to the Absa Group’s Africa Financial Markets Index 2022. It reveals that the east African country has scored 90 percent in legal standards and in enforcing them. This score reflects that there is a high level of transparency in the market.
Transparency in the financial services industry in Uganda has improved due to proper legal enforcement from the regulator – the Bank of Uganda, according to the Absa Group’s Africa Financial Markets Index 2022. It reveals that the east African country has scored 90 percent in legal standards and in enforcing them. This score reflects that there is a high level of transparency in the market.
The higher degree of legal protection for both lenders and borrowers positively affects banking and financial services since there is a positive relationship between the degree of law enforcement and banking system performance.
The annual Absa Financial Markets Index is measured using six benchmarks, such as market depth, access to foreign exchange, market transparency, tax and regulatory, capacity of local investors, macroeconomic environment and transparency, legal standards, and enforceability. Incidentally, Uganda and Mauritius had the same score ranking third after Ghana, which was second and scored 95, Nigeria and South Africa scored 100 percent.
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Uganda’s transparency, tax and regulatory environment registered the largest increase to 81, from 60 in 2021. Regionally, Uganda was ranked number one in East Africa followed by Rwanda at 43, Tanzania 55 and Kenya at 61.
